In part one of our post-Brexit blog series, we are taking a look at the impact Brexit might have on London businesses and more importantly, their workplaces. We believe that the UK’s decision to leave Europe can in fact have a positive effect on businesses and their office environments. Despite a general feeling of uncertainty throughout the business world, Brexit will force businesses to re-examine their overheads and the outcome of this, we believe, may be more rewarding than detrimental.
With the inevitable tightening of budgets, companies will look to cut costs and assess the efficiency of their offices. Digby Flower, of Commercial real estate agents Cushman & Wakefield, has outlined that “we will continue to see occupiers moving roles that it is not essential to perform in London to cheaper locations.” There is nothing surprising about this trend but if you aren’t looking to move out of London or indeed are not required to action your lease, there is certainly something to be said for considering how your current space works for you rather than upping sticks and fleeing the City.
The fact that businesses will contract and begin to monitor spend is no secret. John Forrester, EMEA Chief Executive of Cushman & Wakefield, outlines that “a period of further uncertainty is unavoidable as businesses, the financial markets and the political establishment in the UK, Europe and globally come to terms with what this means.”
Having to reimagine your existing office space is an excellent opportunity to save money through workplace consultancy and space planning. Office relocation is an expensive and time-consuming procedure, so if you are looking to move office to help manage costs or to cater for reduced occupancy, you may be better suited to adapting your office design and refurbishing your existing workspace. This can be done by firstly analysing your workspace to see how efficiently you are using the office space that your business leases. Identifying areas of inefficiency can then be addressed by implementing hot desking, agile working spaces and hybrid environments, allowing you to make your office space more cost-effective as well as improve the happiness, productivity and motivation of your staff.
In 2012, The Independent reported that ‘companies are wasting a whopping £42 million a year on office space they don't need.’ The paper claimed that office space was being over calculated and that ‘office space should be calculated at no more than between 85 and 90 square feet per person.’ This is where a lot of companies are falling down, as a huge portion of their costs are being eaten up in wasted floor space. The two main culprits of wasted office space in London are workstations and meeting rooms which are either underutilised or used in the wrong way. I’m sure that if there was an employee not working hard or being productive, they wouldn’t remain at the company. Why should that be any different with office space?
Cushman & Wakefield’s London Occupier Fit Out Cost Guide 2016 shows that the average medium cost fit out in London costs £78 per sq ft This average extends up as far as £129 per sq ft for high cost fit outs in London. Whether you are in agreement with Adam Landau’s comment that 100 sq ft per person is an oversubscription by 10 or 15 sq ft, an office designed to this specification for 100 staff is essentially adding between £129,000 -£193,500 to costs. In an effort to reduce overheads, there are plenty of opportunities to refurbish your office, starting with workplace consultancy, so this space can be repurposed to benefit staff and free-up floor space.
A great example of this, which Peldon Rose has recently been involved with, is Kantar Worldpanel where, following workplace consultancy, we were able to reduce their desk space by 40% by introducing hot-desking and storage lockers. In this newly freed up office space we created versatile agile working and collaboration areas with intelligent use of office furniture. The output of all of this has been a more positive and inspirational workspace which enhances communication and collaboration with new opportunities and friendships being created.
In existing offices, space planning and workplace consultancy makes your office work harder and smarter. If you have to action your lease, it can be beneficial to take a space that is slightly bigger than you need. Despite this sounding profoundly counter-intuitive, companies are beginning to see the benefits of taking larger spaces and letting their surplus space to businesses who need a short-term workspace, conferencing space or meeting rooms. Whether you have new or existing space, for the budget conscious, post-Brexit office design, we are expecting to see a big increase in these lettable, dynamic spaces.
Where letting surplus space isn’t feasible, transforming underutilised office space into staff break-out areas or agile working environments can help improve communication and interaction between staff. Wasted space is expensive, so instead of relocating your office because it is too big, using workplace consultancy can save you money and improve how your business and people perform.
Amidst the uncertainty, there is a natural desire to drastically cut costs and take less space, but we have seen many companies already this year benefit from investing in workplace consultancy. Money invested in sound workplace consultancy repays itself handsomely in the future through informed strategic decisions about how you manage one of your largest overheads – your office.
To grow your business while protecting your finances and managing your assets, read about the benefits of leasing your office fit-out here.
Please insert a valid email